What’s the Difference Between a Donkey and an Elephant? Using Panel Data from US States to Estimate the Impact of Partisanship on Policy Settings and Economic Outcomes

Andrew Leigh

No 504, CEPR Discussion Papers from Centre for Economic Policy Research, Research School of Economics, Australian National University

Abstract: Using panel data from US states, I measure the impact of partisanship on a wide range of different policy settings and economic outcomes. Across 32 measures, there are surprisingly few differences in policy settings, social outcomes and economic outcomes under Democrats and Republicans. In terms of policies, Democratic Governors tend to prefer slightly higher minimum wages and more redistributive taxes. Under Republican Governors, incarceration rates are higher, while welfare caseloads are higher under Democratic Governors. In terms of social and economic outcomes, Democratic Governors tend to preside over higher median post-tax income, lower post-tax inequality, and lower unemployment rates. However, for 25 of the 32 dependent variables, gubernatorial partisanship does not have a statistically significant impact on policy outcomes and social welfare. I find no evidence of gubernatorial partisan differences in welfare generosity, the number of government employees or their salaries, state revenue, incarceration rates, execution rates, pre-tax incomes and inequality, crime rates, suicide rates, and test scores. These results are robust to the use of regression discontinuity estimation, to take account of the possibility of reverse causality. Overall, it seems that Governors behave in a fairly non-ideological manner.

Keywords: median voter theorem; partisanship; state government; taxation; expenditure; welfare; crime; growth (search for similar items in EconPapers)
JEL-codes: D72 D78 H71 H72 I38 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2005-11
New Economics Papers: this item is included in nep-pbe and nep-pol
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Persistent link: https://EconPapers.repec.org/RePEc:auu:dpaper:504

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